Alex Sherman is a reporter at Bloomberg’s New York headquarters. He started at Bloomberg in 2008 as an intern out of graduate school and has since worked in a variety of roles and covered a number of beats. Now, he covers mergers and acquisitions in the technology, media and telecom sectors.
In Depth recently spoke with Alex to discuss the hectic world of tech and telecom deals and his fast-paced life as a Bloomberg reporter.
Can you discuss your professional background and how it led you to Bloomberg? What skills have you developed over the years that help you in your current role?
I started on the TV side as a writer and a producer. I was with TV for about two and a half years, and then I shifted over to the reporting side, which is what I had always wanted to do. I was placed on a beat permanently where I was covering the world of pay television – meaning Dish, DirecTV, Comcast, Time Warner Cable and others. I quickly was covering all media because there’s so much convergence and overlap today. So I started to report, with help from colleagues, on Netflix, Apple TV and Hulu because they’re either working with or against the big incumbents, and then I shifted over to become our tech, media and telecom mergers and acquisitions reporter. It was a natural transition for me because many of the things I was covering in the past year or so of my media beat were merger and acquisition deals — Hulu, Dish’s attempt at buying Sprint, and Comcast’s eventual deal for Time Warner Cable.
You’re also working on getting your MBA at New York University. How relevant are your studies to the reporting you do now for Bloomberg?
It’s such a nice thing; it really adds to my reporting. As I covered pay-TV, I was taking these media and entertainment classes that were being taught by people who were running the companies I was covering. And as I’ve switched over to the M&A beat, there are also plenty of classes on mergers and acquisitions and valuation of companies. So it’s been very useful.
How does the media and telecom deals beat compare to other related subjects, like reporting on general trends or developments in technology?
It’s very intense. It’s extremely competitive. I would say it’s probably the most competitive beat at Bloomberg. We’re trying to break stories before the competition – and before the company issues a press release. The idea is we want to move markets. We want people to get their money’s worth from the Bloomberg Terminal by having us break these stories. It’s all hands on deck.
There’s a lot of collaboration between the company news teams and the deals teams. So if I’m covering tech, media and telecom deals, I’m working very closely with all the company news reporters in tech and all the company news reporters in media and telecom. It’s me trying to get a good sense of what all these companies do and what they’re looking for because, obviously, in the entire world of media and telecom, there are a lot of companies. So I rely on the company reporters to help me.
Are there any trends in the deals space that you’re seeing? Like for example, are you concerned about the magnitude of the deals happening nowadays?
There’s definitely a consolidation trend in telecom and media. We’ve seen it with Sprint and T-Mobile potentially trying to merge, and with Comcast and Time Warner Cable, too. Industries that are large network industries (the wireless networks, the cable networks) have to get more scale to grow because their industries have matured. The bigger you get, the more profitable you can get, because each additional customer represents a lot of profit if you’re thinking about the incremental cost of, say, an Internet subscriber. The cost is low to add you to the network once it’s already built. So these companies just want to get bigger and bigger, and that means more M&A activity.
On the tech side, there’s no question that the old stodgy enterprise companies like Oracle and IBM need to get into the cloud. That’s where it’s moving. They’ve spent years and years, and billions and billions of dollars, developing these enterprise systems for companies using hardware, but now everyone wants stuff in the cloud, so they’re going to have to transition. How they get there is an interesting question; a lot of these cloud companies are super expensive these days. We’ll have to see how this happens: if they build it organically or if they start to make really expensive acquisitions.
And then obviously, all the Internet companies want to get into the mobile space, which is why we saw Facebook spend $19 billion on WhatsApp. They need to get mobile technology in order to stay relevant. So that’s another trend.
What’s it like working at Bloomberg’s headquarters in New York? Is it exciting to be in that fast-paced newsroom environment?
I go into friends’ offices occasionally, and I’m reminded of how amazing this office is. After six years, you start to get used to it; it’s just where you go to work. You have to go out and see other offices to realize that it’s really unique to be here.
It’s a vibrant place. There’s a lot of light here, which is nice; a lot of other places are darker. The newsroom is always active. I like that our TV set is now in the newsroom, which is much different from when I started here; it’s much lighter and more active. Of course, there’s the free food. This is certainly the best office that I’ve been in to work. It’s a big perk of the job to come in to this office every day.
What privileges do you enjoy as a reporter for Bloomberg? Do you get any kind of special access in the business world that you might not get otherwise?
Absolutely. The best part is that the Bloomberg brand is strong enough that people in the business world realize that if they talk to me, the message is going to get out to the people that matter for them, which is mainly their investors. That’s the biggest perk of the job – that the brand is strong enough.
There’s a nice feedback loop that happens here. The investors read my stories, so they’ll talk to me, and they’ll talk to executives out there in the world. The executives will then talk to me and read our stories, because they realize it will get back to their investors, the general public and so forth. That’s the feedback that you want. If you’re in that circle, you can beat the competition, and you add a lot of value to the Bloomberg brand.
© 2014 Bloomberg Finance LP